What Are the Chances I Could Be Audited by the IRS?

The likelihood of being audited by the IRS (Internal Revenue Service) depends on several factors, including the type of tax return you filed, the deductions you claimed, your income level, and other information on your return.

In general, the overall audit rate for individual tax returns is relatively low. According to the IRS, the overall audit rate for individual taxpayers was 0.45% in 2020. However, the audit rate increases for taxpayers with higher incomes and more complex tax situations.

For example, taxpayers with income over $1 million had an audit rate of 2.21% in 2020, while those with income between $500,000 and $1 million had an audit rate of 1.13%. Taxpayers who claim certain deductions or credits, such as the Earned Income Tax Credit, may also be more likely to be audited.

It’s worth noting that the IRS uses a variety of methods to select returns for audit, including random selection, computerized screening, and information matching. Even if you have done everything correctly and filed your taxes accurately, you could still be selected for an audit. It’s always important to be truthful and accurate when filing your taxes and to keep thorough records to support any deductions or credits you claim.

If you have received a notice from the IRS that you are being audited and you don’t know what to do, complete our tax case review form for a free consultation with an experienced tax professional.